Microsoft's Game Division Suffers $1.89B Shortfall

Both MS and Sony have really blown it with this generation of consoles. It pains me that Sony could have driven a stake in MS if they hadn't botched the PS3 by making way too expensive. Not saying that the Wii isn't a great concept, but Nintendo has benefited greatly by the others' missteps. Going forward, I suppose Nintendo continues rolling and the Wii will pass the Xbox360 in total sales within a year or so. How the PS3 vs. Xbox360 scenario plays out long term remains to be seen.

 

fo real both MS and Sony have had some major mess ups. I think Sony got the message already though, they're steppin their game up.

 

I think Sony coming off as a mess had to do with the 360 coming out so soon. The PS2 was still kicking ass, ideally Sony probably wanted to release the PS3 way later. 360 forced Sony's hand somewhat in my opinion. 3rd parties where not prepared to support Sony's new hardware.

360 is doing bad because of unit failure and the unlikeness that an American based console could ever have any major impact.

 

Even though it is in line with their 'predictions', it's still a big chunk of change. The whole extended warranty thing is a nice sting too, but it had to be done.

 

so basically the Wii is the only next gen machine making money... ok i love the Wii and all but i also like my hidef games...heres to hoping one of the two starts turnign a profit eventually

 

Doesn't this include their costs on hardware? I know they expect to lose money and have amortized their R&D costs across a few years, so not surprising.

DD

 

Sounds like typical business, lump all your loses into one quarter and then flip it in the next quarter to profit......

DD

 

Microsoft makes money on selling the 360 and soon sony will make make money on ps3. If everything ran like the semiconductor industry we would have a cure for cancer and 500 mpg cars. Once 1 chip is the made the rest cost pennies on the dollar to make and the process get much more efficient very quickly.

 

Good god that a lot of f'n money...I know MS makes money as a whole, but wow, talk about a loss leader...

It is somewhat surprising a year plus after launch that you have such huge losses...I know they're not going to shut down, but if it were any other company, it would...

As for Sony, I can see a huge loss this year due to the same problems, but not as large...And people still want a price cut, which I dont' think it can afford...

 

I don't understand this. Why does one console have to "win"? I think it's great that there is competition. I have a 360 and I like what it does for me. I plan on getting a PS3 eventually too and I'll like what it will do for me too.

I just don't get why one has to put a stake in the other. It's stupid.

 

Do you really see it being that profitable in the near future? They took a huge $1B charge for the warranty extension, but the division still lost $1.89B. That means that without this one time charge, the division still would have lost almost $1B. I don't know about anyone else, but I don't see them making a $1B increase in sales in the next quarter.

 

does this mean that no systems will be left except for the wii?
nope. i don't understand why you 'gamers' are so caring about the corporations anyway. its not like sony is going to dissappear like casper the friendly ghost or microsoft will stop making the xbox.

i mean ford and gm still make cars. and they have lost way more than sony and microsoft.

hint: these aren't small businesses.

 

oh look..


http://www.engadget.com/2007/07/20/microsoft-by-the-numbers-xbox-down-1-9bn-sells-over-1m-zunes/

Oh sure, Microsoft is kind of bummed about a few things. It just posted a $1.9 billion loss ($1.2bn coming from Q406, when it started dealing with the red ring of death) and its head of Xbox, Peter Moore, just took off (or was fired); the Zune may be a bit of a laggard, selling just 1.2m units in the course of ten months (compare to Apple's brisk iPhone sales, thought to be between 500k - 1m or more in just a few days), and the fact that "Vista is doing ok, but it isn't blowing the doors off," according to one Microsoft-trading stock manager. Still, Microsoft's bottom line ain't nothing to scoff at: profit is up 7.3%, with the company taking in $3.04 billion over $51.1 billion in sales in its last financial. These figures are boring to some, we're sure, but there's something kind of fun knowing that Redmond could probably afford to buy the world's beaches at $1 per grain of sand.

 

Karma is a b**** with 3 blinking red lights.

 

Duuuuh, I like competiton too. No matter how poorly or well the Xbox360 does, MS will stay in the game by pouring in whatever money is necessary. They are in it for the long haul. I guess exaggeration is completely beyond you. Try sucking oranges instead of lemons Mr. Crabs.